MBA402 Assessment 2: Analyzing ANZ Bank Code of Conduct

This report provides a detailed analysis of the corporate governance issues at ANZ Bank, focusing on the development of a comprehensive code of conduct. The report addresses key areas such as discrimination, exploitation, corruption, dishonest and fraudulent behavior, whistleblower protections, and enforcement, drawing on recent news articles and academic sources. The analysis begins with an overview of corporate governance principles and their application to ANZ Bank, followed by a discussion of the bank's existing policies and framework. The core of the report involves the creation of a draft code of conduct specifically tailored to ANZ Bank, incorporating best practices and addressing the specific governance challenges the bank has faced. The report incorporates a minimum of five references from academic journals and textbooks to support the recommendations. The report aims to provide a practical guide for improving ethical standards and corporate governance at ANZ Bank, ensuring transparency, accountability, and stakeholder protection.

Running head: GOVERNANCE ISSUES AT ANZ BANK
GOVERNANCE ISSUES AT ANZ BANK
Name of the Student:
Name of the University:
Author Note:

1GOVERNANCE ISSUES AT ANZ BANK
Corporate Governance:
The term corporate governance refers to the governing structure of an organization. The
governance system includes the rules, structures, and the corporate practices and policies, which
are developed and directed and controlled by the organizational body. The corporate governance
also refers to the roles and responsibilities of the employees in the organization. The corporate
governance describe upon the essential roles of the stakeholders and the senior manager
executives, as well as the roles and responsibilities of the customers, financiers, suppliers and
community members, and therefore, the corporate governance aspects of the organization
establishes the framework of the organizational objectives (Claessens, and Yurtoglu. 2013).
Thus, the corporate governance includes all the sphere and aspects of the organization, and
ensures the action plans and the internal controls of and the performance measurement of an
organization.
Therefore, the considering the above definition of corporate governance it can be said,
that the governance refers to the communication and control practiced within an organization.
Therefore, the basic principles of the corporate governance of an organization includes the
following,
The legal, social and contractual obligations of the shareholders and the non-shareholders of the
organization must be highlighted and upheld, thus establishing a continuous communication
within the organizational system.
There also must be a code of conduct practiced within the organizational which will be
established and practiced by the corporate governance system of the organization, and this code
of conduct will include the behavioural practices within the organization and the policies and
procedures to be practiced within the same.

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The principles of corporate governance also ensures that the that all the stakeholders of
the organizations must be treated fairly and equally, and therefore, it aims at ensuring providing
equal rights to all the stakeholders of the organization.
Therefore, the three pillars of corporate governance, that ensure the practice of the
aspects of corporate governance within the organization, are Transparency, Accountability and
Security. The aspects of transparency refers to allowing the processes and transactions, being
understandable and observable to the stakeholders as well as the suppliers and the customers.
The aspects of transparency refers to the fact that the organization has nothing to hide form its
members and its customers. It is essentially considered in the aspects of the transaction process,
since there had been a number of fraudulency incidents and organizational scams, which had
essentially affected the employee and the customer base of the organizations and the market
position of the same Hermalin. 2014). It is one of the most critical components of the
organization, as it ensures and checks upon the conducts of the organization, and also establishes
the facts that these organizational activities and conducts can be observed or checked upon by
the customers and the stakeholders.
The second aspects is the factor of accountability. The factor of accountability refers to
the answerability or liability of the organizations. A simple understanding is that every
organization is answerable for all the conducts and the activities that it includes, and this can
mean that the organizations can face questions from the legal aspects as well. Therefore, the
factor of liability prevents the organization from indulging into any activities that will question
its liability, responsibility and the transparency of the organization. This helps the organization in
increasing the confidence of the stakeholders and to better its position in the market, and at the

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same time, it helps the organizations in maintaining the customer base of the organization
(Tricker, and Tricker. 2015).
The third pillar of the corporate governance is the aspects of security. To practice the
factors of accountability and transparency, it is important to keep it safe from the unauthorized
accesses. The organizations musts ensure that all of its data are secure from the outside resources
or the unauthorized people. It is observed that, many organization have often faced complaints
from the public and the regarding the exploitation and the misrepresentation of the data. Many
organizations have also observed situations whereby their data and information have been
decoded and therefore, have been published in the social media, which again had affected their
position in the market as well as, their customer base (Tricker, and Tricker. 2015).
Therefore, in the following essay, the corporate governance of the ANZ Bank of
Australia, will be discussed and at the same time, the issues that the organization has faced in the
similar area, will also be analysed.
ANZ Bank:
The Australia and New Zealand Banking Group, or the ANZ Bank is a multinational
bank of the country, headquartered in Melbourne. Established in 1951, the ANZ Bank is the
second largest bank of the country, and it is one of the dominating banking houses of the country
dealing in both commercial and retail banking. However, the bank has a strong a policy structure
and governance framework, which provides a structure to the organization and determines an
effective decision making structure to the organization.

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The Corporate Governance Policies- ANZ:
The policies and the structural frame work of the organization are determined and made
according to the guidelines provided by the Australian Securities Exchange (ASX), and the
recommendations provided in the guidelines or the framework determine the organizational
conducts and the corporate governance principles to the organization. Also, the board of
directors of the organization hold an accountability to the shareholders of the organization, in
relation to the operational and the financial conducts of the organization. The organization also
includes an audit committee, that ensures all the financial and the operational conducts and the
also includes the approaches of risk management. The organization also includes two sets of
code of conduct which guide the behavioural conducts of both the employees and the directors of
the organization. Also, the decision making structure of the organization is also guided by the
structures of codes of ethics of the organization (Bottomley. 2016). The committee includes the
anti- bribery framework and the anti- corruption frame work and the like, to ensure a fair
operational conduct into the organizational structure. The organizational also includes a set of
employee management and tax management policies and procedures, which come under the
other policies provided by the company. The organization also includes the constitution, to guide
and determine its organizational conducts and its accessibility and remuneration plans.
The Scandals of the Organization:
Though the organization has a strong guideline and a policy framework to follow, yet, the
organization has, over the time involved into a number of fraudulent and corruption behaviours
and activities that had effectively affected the reputation of the company. One of the most
important aspect or activity that the organization had involved into, was the whistle blower
protections or activities. One of the stakeholders of the organization, Steve Bellotti, who is

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regarded as the one of the most successful investment bankers, is very popular because of his
whistleblowing activities. Over the tine, there had been many incidents where his name had been
repeatedly come across because of the practices and activities that he involves into and also
because of the attitude that he practices in his personal and professional life. Recently, in an
award ceremony he had voluntarily involved himself into a brawl. He also has a drinking
problem, which is another defaming attributes to his name. He is also known for his bratty
attitude. He had rented out the Richard Branson's Caribbean for one day, at the rate of $40,000
for his birthday, and he spends ridiculously on his birthdays. His 40th birthday was known to be
lasted for a three weeks. He also involved himself into a trading room brawl, which had left her
with a black mark in the eye (Christodoulou et al., 2020). This had affected the reputation of the
organization.
Along with this, the organization was also involved in a corruption activity. One of the
most popular the within the organization was the “slaughtering the rate”, and this was a
connotation to one of the independent rate, which is supposed to be set by the organization itself,
and it was manipulated by the organization, from which, they gained a good amount of profit,
each day. This had been in the practice for a very long time, and it was as late as 2014, that
investigations regarding this practice had been initiated within the organization. However, the
ASIC had maintained its code of conduct, and no information regarding the confidential aspects
and the functions of the bank was disclosed, and this a particular behaviour or activity had cost
the bank to spend $50 million in fine, to the ASIC, for preventing the same from taking the case
to the court room (Christodoulou et al., 2020). This was one of the biggest fraudulent activities
of the organization, which are poised completely against the organizational policies and legal
quotations.

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Along with this, another recent news, had clarified that the bank had decided to provide
$682 million to all of its customers, over the last decade. The slug, revealed by the NAB, last
week had confirmed that the organization had been involved in a manipulating behaviour with
the accounts of its customers. Also, since the compensation cost has increased in the industry,
therefore, this has also made a potential impact in the organization (Butler, 2020). However, the
organization, is acknowledging the issues in the industry, and it has repeatedly told to the media
that the organization is trying to fix the customer related issues with its 500 specialists who are
not only efficient but also are dedicated to the organization.
Also, the cartel formation that ate organization had involved is also worth mentioning
here. Though it was not only ANZ, which was involved into the affair, but there were three
other, reputed banking houses as well, involved in this matter. However, since it was ANZ who
had to raise the $3 billion, to increase its capital shares, therefore, allegedly, it was the name of
this organization, which came up, repeatedly. The cartel formation, which took place between
the for banks was not only the exploitation of the rules and the procedures of the corporate
governance practices, but at the same time, it was exploitation of the customers as well, who got
devoid of the actual prices of the shares (Fernyhough, 2020). This was utterly an act of
dishonestly, and exploitation.
Lastly, the racial work culture that is practiced by the banking house must also be
mentioned, in the light of this discussion. In 2016, the company had to face a lawsuit by an ex-
employee of the company. Ms Oyo, an ex- employee of the organization had allegedly filed a
case against the company when she had been terminated by the same, for complaining against
the racial behaviour taking place within the organization, to her senior manager. She had claimed
that she had to face sexually derogatory remarks openly, that too, from the high ranked senior

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colleagues of hers. She had been harassed by the women of the workplace as well, and her skills
and efficiency had been compared to the monkey, by her direct supervisor. The company had
continuously harassed her through the litigation process, and upon complaining, the organization
had demanded all of her medical records including the gynaecological records and the Banks’
lawyers had compelled her to recount the details of sexual harassment that she had faced during
her time in the freshman years (Wigdor LLP, 2020). Thus, was the cultural sphere of the
organization, however, the CEO of the company had later apologized to her via Twitter.
Conclusion:
Considering the above discussions, it can be claimed that the organization has been
effectively involved into the corporate governance issues. There are essentially six forms of
issues that are usually practiced or observed within an organization, being, the issues related to
discrimination, enforcement, corruption, dishonesty ad fraudulent behaviour, and the
whistleblowing protections. Considering the above discussion, it can be said that the organization
has actively and potentially been involved into all of these forms of behaviours. Especially,
because of the whistle blowing activities because of the sexist and racial cultural practice within
the organization, the banking corporation had effectively made its place across the front page of
the newspapers, which had cost it, the reputation and the customer base.

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References:
Bottomley, S., 2016. The constitutional corporation: Rethinking corporate governance.
Routledge.
Butler, B. (2020). ANZ bank reveals it is reviewing its anti-money-laundering systems amid
Westpac scandal. [online] the Guardian. Available at: https://www.theguardian.com/australia-
news/2019/nov/27/anz-bank-reveals-it-is-reviewing-its-money-laundering-systems-amid-
westpac-scandal [Accessed 2 Jan. 2020].
Christodoulou, M., Worthington, E., Sveen, B. and Mitchell, S. (2020). The 'Slaughter' House:
ANZ's plans to thwart one of Australia's biggest-ever financial investigations. [online] ABC
News. Available at: https://www.abc.net.au/news/2019-05-24/the-slaughter-house-anz-banks-
plans-to-thwart-investigation/9516708 [Accessed 2 Jan. 2020].
Claessens, S. and Yurtoglu, B.B., 2013. Corporate governance in emerging markets: A
survey. Emerging markets review, 15, pp.1-33.
Fernyhough, J. (2020). Everything you need to know about the ANZ cartel scandal. [online] The
New Daily. Available at: https://thenewdaily.com.au/finance/finance-news/2018/06/06/what-is-
a-cartel/ [Accessed 2 Jan. 2020].
Hermalin, B.E., 2014. Transparency and corporate governance. In Enterprise Law. Edward Elgar
Publishing.
Tricker, R.B. and Tricker, R.I., 2015. Corporate governance: Principles, policies, and practices.
Oxford University Press, USA.

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Wigdor LLP. (2020). Open Letter: ANZ Bank Must Fix Its Racist, Sexist Culture. [online]
Available at: https://www.wigdorlaw.com/anz-bank-race-discrimination-sexual-harassment-
open-letter-board-directors/ [Accessed 2 Jan. 2020].